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Chomsky on Geithner

Chomsky: Plan is recycled Bush/Paulson. We need nationalization and steps towards democratization.

WASHINGTON

The Real News' Paul Jay
spoke with Noam Chomsky, professor of linguistics at the Massachusetts
Institute of Technology, to get his thoughts on the Obama-Geithner
plans for bank reform.

"They're
simply recycling pretty much the Bush-Paulson measures, changing them a
little, but essentially the same idea. Keep the institutional
structure the same, try to kind of patch things up, bribe the banks and
investors to help out, but avoid the measures that might get to the
heart of the problem," says Chomsky.

The
plans create a "win-win situation" for investors, he argues: "It means
that an investor can, if they want, purchase these valueless assets,
and if they happen to go up they make money and if they go down the
government insures it. So there might be a slight loss but there could
be a big gain....if you're the investor. For the public, it's a
lose-lose situation."

Chomsky
believes the system is built in a way that often penalizes the public:
"Fact of the matter is, it's almost always public money....The public
pays the cost and takes the risk and the profit is privatized."

He
believes the first steps towards democratization involve
nationalization and public accountability. "For a start, corporations,
banks and so on should be responsible, I think, to stakeholders [as
opposed to shareholders]. That's not a huge change....It's a way to keep
communities alive and industry here."

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